After a significant data centre outage over the weekend that affected more than 53 million users globally, shares of South Korea’s leading messaging app fell sharply on Monday.
The data centre, which houses servers for several significant Korean tech businesses, experienced a fire that caused the outage. In addition to being the most popular messaging app in South Korea, KakaoTalk is also heavily used for a variety of online services, including ride-hailing, gaming, and online payments.
During the second quarter, Kakao reported 47.5 million monthly active users in Korea. That represents more than 90% of South Korea’s 51.74 million population as of November 1, 2021.
The effects of the outage on Kakao were similar to those on the national communication network, according to South Korean President Yoon Suk-yeol. In order to develop strategies to avoid repeat instances, he urged the pertinent ministries to look into the precise reason and extent of the disruptions.
In order to protect the interests of the populace, Yoon stated on Monday, “we need to take systemic steps from a national level if there is a monopoly or oligopoly situation where it manipulates the market.”
On Monday, the stock of Kakao Corp. fell more than 9% at the opening, while Naver, a major online player, lost 2% in the morning session before trimming losses. Since Naver’s servers are also housed at the data centre, Naver also experienced minor interruptions of service, but most of its activities were restored by Sunday.
At opening bell, SK Inc., which runs the data centre, also saw a more than 4% decline. In the morning session in Korea, the stock prices of Kakao’s subsidiaries Kakao Pay, Kakao Bank, and Kakao Games all fell by over 7%.
Initially revealed by Kakao on Saturday afternoon, the service outages persisted throughout Sunday morning.
The co-CEOs of the company issued an apology to all users who are now experiencing Kakao service disruptions in a statement over the weekend.
The organisation has been working to back up data to other facilities in the nation ever since the fire broke out, they added, adding that they “commit to take the maximum precautions to prevent difficulties like these from reoccurring as well as researching the source of this incident.”
The implementation of these [back up] steps is taking much longer than anticipated, they explained, because this is an unusual instance of only one data centre being affected fully.
Kakao stated in a Monday morning tweet that while some services have restored, customers are still reporting problems.